Main Menu

The Hollowness of the Arguments of the FCC and FTC Chairmen Regarding Internet Consumer Privacy

Chairman of the Federal Communications Commission (FCC) Ajit Pai and Chairman of the Federal Trade Commission (FTC) Maureen Ohlhausen begin their recent op-ed (a bull-headed defense of controversial legislation that, among other things, allows Internet service providers (ISPs) to sell customers’ personal information without their consent) with the quip that “April Fools’ Day came early last week, as professional lobbyists lit a wildfire of misinformation about Congress’s action.” Yet given the chairmens’ obstinate lack of awareness regarding ISPs and the legislation in question, it is more accurate to say that their attempt at April Fools’ Day trickery came late.

In 2015, the FCC voted to regulate ISPs (companies like Comcast, Verizon and AT&T) as “common carriers” (companies providing public telecommunications facilities and services), moving jurisdiction over these entities from the FTC to the FCC. The FTC had previously allowed ISPs to sell user data (such as their browsing history) except where users proactively opted out of such programs. Under the FCC’s oversight, ISPs were prevented from profiting off of customers’ private data without their consent. This year, however, legislation passed in both houses of Congress on party-line votes (with Republicans supporting and Democrats opposing) and was signed by President Trump on April 3rd undid the FCC’s actions and reverted ISP regulation to its previous form. Customers will soon have to proactively opt out of any programs that their ISPs put in place to sell their personal information to advertisers.

Pai and Ohlhausen’s main argument for why recent legislation is a good thing is that the FCC’s 2015 actions unfairly treated ISPs differently than Internet browser and search providers and social media companies (like Google and Facebook) who could still freely collect and market user data. The chairmen argue that since ISPs and companies like Google and Facebook have access to much of the same customer information, the “FCC’s regulations weren’t about protecting consumers’ privacy. They were about government picking winners and losers in the marketplace.”

The chairmens’ reasoning is seriously flawed for a number of reasons. The FCC’s rationale for more strictly regulating ISPs was its determination that they are common carriers akin to public utilities (i.e., companies that provide the public with necessities). In today’s Internet-centered society and economy, it’s hard to argue that Internet access hasn’t become a public necessity. Tellingly, Pai and Ohlhausen don’t challenge the importance of Internet access in today’s world. In fact, Pai is a big supporter of expanding Internet access to rural and poor areas to aid their development. This is a clear acknowledgment of the modern necessity of this resource. Pai has, however, expressed [PDF] the conviction that the Internet has become so important and successful because of a lack of regulation. But this is not an effective argument against ISPs being common carriers. Rather, it’s simply a preference for how the government can best nurture the expansion of Internet access.